Debunking Republican Junk Economics: Canadian & Bakken Formation Oil Feeds Record Fuel Exports
This is an update of some recent posts on US energy independence, higher gas and diesel prices, government oil subsidies, and claims that gasoline prices could be lowered by Republican policies. The best of them are listed to the immediate left. First, however, is some context for the following USEIA-provided graph, which is new.
U.S. petroleum product net exports (exports minus imports) averaged 0.44 million barrels per day (bbl/d) in 2011, with imports at a nine-year low of close to 2.4 million bbl/d and exports at a record high of nearly 2.9 million bbl/d. The gap between exports and imports widened the most during the second half of the year from August through December (see charts below), with total monthly exports topping 3 million bbl/d for the first time.
To fully grasp the significance of the net exports trend depicted on the above chart you also need to read this cite from the USEIA:
Strong global demand helped propel distillate exports, as distillate fuel, which includes diesel, had a higher profit margin for U.S. refiners than gasoline. Refiners also had access to increased supplies of crude oil imports from Canada, which in 2011 topped 2 million bbl/d for the first time, and from North Dakota's Bakken formation to process into petroleum products.
Not many are familiar withe the Bakken Formation. For background in today's political context, see: Updated: Williston Basin (Bakken Formation) Oil Might Be An Election Changer
Note: Refinery output can be 'tipped' to favor diesel production over gasoline production; or, the other way around. Less gasoline production allows for increased production of the more profitable diesel fuel. It's called the free market. Surprisingly, Republicans don't seem to grasp it's fundamentals.